Israel Corp. Chinese car venture obtains finance

Qoros Auto has obtained a $470 million loan from a syndicate of foreign banks.

Israel Corporation (TASE: ILCO) today notified the TASE that its Chinese joint venture Qoros Auto Co. Ltd. has signed a $470 million financing agreement with a syndicate of foreign banks to finance the construction of a plant for the production of 150,000 cars.

The financing agreement is for ten years. Qoros will provide collateral for repayment of the loan. Chery Automobile Company Ltd. (which owns half of Qoros) provided $235 million in guarantees. A company from the city where the factory will be built provided guarantees to the lending banks for the $235 balance of the loan.

Israel Corp. (which owns half of Qoros) promised Chery to pay half of any amount that Chery will be required to pay under the guarantees it provided in the financing agreement, up to $118 million, as well incidental costs and interest on the loan principle.

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